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Sober Wake-Up Call At Morningstar Conference

Morningstar's Investor Conference in Chicago may have echoed with many of the same old solutions of the past, but for those who listened carefully to Mohamed El-Erian's message, "This time it's different."

El-Erian, who is co-chief executive and co-chief investment officer at PIMCO, warned investors that the economic volatility that plagued the market this year should not be taken lightly or as some sort of fleeting rarity.

"The unthinkable has become thinkable. This is not noise; these are signals, and understanding these signals is the difference between superior performance and the opposite," El-Erian said.

Although the speech was lacking in terms of concrete solutions, El-Erian attempted to discuss both sides of the economic predicament and stayed positive by noting that times of crisis also inevitably bring certain opportunity for those that can properly position themselves. He also touched on issues like inflation and the emergence of other markets in the global economy, saying that they need to be accounted for and taken very seriously.

Others, like Don Phillips, a managing director at Morningstar, agree.

"It's not the first time we've had to worry about inflation, just the first time in a few decades. It's not that we haven't seen globalization coming, it's that we might not have recognized the permanent changes would be this fast," Phillips said.

Phillips suggested that investors broadly diversify, make note of inflation and absolute returns and simply stick with their plans. Overall, avoid being swayed by what's hot in the moment, and stay focused and patient, he said.

El-Erian, who is also the author of a new book called "When Markets Collide," truly believes that investors need to prepare themselves for a changing world, and changing markets.

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